Gold and silver are experiencing an epic bull market, with a powerful surge at the start of the year intensifying the rally. In 2025, gold rose over 60% and silver soared nearly 150%, marking the strongest annual performance on record. Since the beginning of 2026, gold has climbed over 15%, breaking through the $5,100 barrier, while silver has skyrocketed more than 40%, surpassing the key $100 per ounce milestone.
Prominent economist Ren Zeping stated on social media that there are three major driving forces behind this trend.
First, global geopolitical instability and the late stage of a major cycle have maximized safe-haven demand. The world is in the late phase of a major cycle where the old order is disintegrating and a new order is being rebuilt, characterizing an era of significant transformation, adjustment, turbulence, and transition. Frequent events such as the political changes in Venezuela, the Greenland dispute, and the US-Europe tariff war have unprecedentedly highlighted the value of gold and silver as safe-haven assets for allocation.
Second, deglobalization and de-dollarization are reshaping the pricing logic for gold and silver. The US instigation of tariff wars has triggered global trade frictions, spreading the trend of deglobalization. Concurrently, global de-dollarization is underway, fueled by high US fiscal deficits and an erosion of the Federal Reserve's independence. Many central banks are selling US dollars and accelerating gold purchases, causing the dollar's share of global foreign exchange reserves to drop from 71.2% to 56.9%, a 14-percentage-point decline, with 5 percentage points of that fall occurring in the past six years.
Third, the Federal Reserve's massive liquidity injections have led to persistent currency oversupply by the US. Whether addressing the 2008 subprime mortgage crisis or the 2020 pandemic, the Fed activated the printing press, employing QE, QQE, unlimited QQE, and helicopter money. The US national debt has exceeded $38 trillion, with the Fed purchasing US Treasury bonds through money creation, causing its balance sheet to expand rapidly and the purchasing power of the dollar to decline significantly; the epic rise in gold represents the external devaluation of the dollar.
2026 marks a Fed easing cycle. The current US economy presents a "dual narrative": on one hand, structural depression caused by the decline of traditional industries, and on the other, structural prosperity driven by a new wave of technological revolution. To revitalize the traditional economy, support the new economy, and considering the Trump midterm elections, US fiscal and monetary policy has entered an easing cycle, even interfering with the independence of the Federal Reserve's monetary policy.
Furthermore, silver's dual industrial properties provide an additional boost from exploding new energy demand. Silver possesses the highest electrical and thermal conductivity of all metals and is extremely difficult to substitute, making it indispensable in photovoltaic panels, new energy vehicles, and communication equipment. With the rapid global development of new energy and AI, and a sharp increase in solar PV installations, silver is no longer just a traditional industrial commodity and precious metal, but a strategic resource closely linked to high-tech industries. The global silver supply deficit in 2026 is projected to remain above 100 million ounces, with industrial demand and financial attributes creating a dual-driver effect that amplifies its price volatility.
